Given the near-short-term shift in business world dynamics, companies wishing to expand their boundaries choose the two most sought-after approaches.
These are staff augmentation and IT outsourcing. At first glance, these two models seem similar, but this is not true. They are rather divergent in their construction, influence on what control you have over the projects you have, and the results they yield. However, as the quest for efficiency and productivity reaches a fever pitch, it becomes necessary to distinguish clearly between staff augmentation and IT outsourcing. It is also of prime importance to choose the one appropriately.
In this blog, we will evaluate those two models point by point and highlight their merits and demerits. We’ll pay attention to significant aspects such as security and data protection, cultural compatibility, the terms of the contract, financial factors, and the potential of hybrid schemes.
Let’s assist you in finding the most appropriate solution based on your business needs.
What is Staff Augmentation?
Staff augmentation refers to bringing in outside contractors on a short-term basis. They aim to join pre-existing teams formed by the companies. Such contractors are hired to provide specific skills and work directly with your existing employees.
Usually, the expanded team members' tasks revolve around certain projects or tasks for a limited period of time. This provides your organization with flexibility and growth options.
When Would It Be Advisable to Go For IT Outsourcing? - You prefer to have a vendor execute the whole project or service than individual team members executing a specific aspect of the project. It happens when:
Now that we know what is IT outsourcing and staff augmentation, here are the key differences between these two:
1. Control Over the Project
The main advantage here is full control of the project. The augmented staff works under your management and becomes part of your team. Their tasks are under your control, and they are all required to comply with your standardized tasks.
In this scenario, your participation in everyday activities associated with the project is significantly less. An outsourcing vendor handles the whole project. The vendor runs the business as per the service level agreements (SLAs) and is not expected to do anything outside the agreements.
This model, however, is more flexible. Based on the project's demands, you can augment the team or reduce its numbers.
It is also possible to scale in the case of outsourcing. However, the changes are mostly enforced through contract renegotiations, which is a slower process than the one presented in staff augmentation.
In this strategy, a full team of specialists is available and takes care of certain functions in their entirety. For example, they provide software development or manage network security. This model is ideal for bigger projects which demand a wider range of skills.
It is possible to engage specialists for certain activities allowing you to obtain adequate skills for your project. However, you may have to deal with different levels of expertise from several professionals.
Outsourcing offers a complete team of experts that manage entire functions, such as software development or network security. This model is more suitable for larger-scale projects requiring a broad range of expertise.
In the case of staff augmentation and IT outsourcing, security and data protection are top priorities. They are particularly important for companies that handle sensitive or confidential information.
Better communication is important in both staff augmentation and IT outsourcing strategies. The success of either model is determined by the extent to which the external team integrates into the company's cultural and communication environments.
Clear-cut and service-level agreements are necessary to control the outlook across the two parties involved.
Knowing how expenses are arranged is vital for hiring additional employees and outsourcing IT. Below is a comprehensive description of the costs involved in both models:
Augmented staff is generally paid based on hourly or daily agreements. Rates tend to differ depending on an individual's skill set and experience level.
The expenses associated with managing the added professionals and training them are often excluded from the equation. This must not be the case.
Staff augmentation can be cheaper for only short-term projects. It becomes more expensive when projects stretch beyond their original plans.
It is necessary to consider not only the buying costs but also the operational costs incurred during the maintenance of the outsourcing services. Sometimes, outsourcing projects have lower initial costs. However, they have higher indirect costs or long-term hidden costs that must be considered.
Non-core business operations are most likely to be outsourced. You rent a service, and a vendor takes care of everything. Thus, there is no need to staff internally or deal with the overhead of managing staff.
Obtaining staff augmentation or delegating IT functions to a provider are acceptable options. Choosing between them can be challenging. You need a clear picture of your business's demands, the extent of the project, and its internal capabilities. These factors all significantly influence which option is appropriate for you.
Here, we shall explore in detail some of the key factors influencing your choice of the decision:
What works best in your business operations depends on how big and complex they are. Smaller and less complicated companies may opt for staff augmentation. It is convenient to boost teams when necessary without the hassles of dealing with large external vendors. In addition, staff augmentation means exercising more control over how the projects are executed.
However, bigger firms can outsource even core activities simply because they cannot cope with the scale and complexity of their IT procedures. For instance, there are global corporations that have several IT bases located across different time zones. This necessitates the help of an external IT support team. This makes it easy to manage the activities, especially where specialized skills or global talent are needed.
Duration is the core difference between IT outsourcing and staff augmentation. Staff augmentation is generally the best-suited model if you require an extra hand for a short-term project. Here, staff augmentation can help you with the following:
It enables you to meet temporary needs quickly and effectively.
However, when the company seeks a sustainable solution or regular IT services, IT outsourcing tends to be more appetizing. IT outsourcing allows organizations to extend carrying out certain continuous functions such as:
It helps you do it all in an affordable range.
If your internal team is not skilled in a particular area, such as software development or data security, staff augmentation is a good option. It helps you bring in specialists who can bridge this gap instantly. On the other hand, outsourcing the entire IT structure may be a more appropriate if the internal team lacks the capacity or skill set to manage an entire IT function.
To illustrate, a business without an IT department may outsource the services involved in managing the IT infrastructure.
Still, they can manage to supplement their in-house team with demand specialists.
The project’s complexity and scope often dictate the model of choice. In general, large-scale long-term projects, which require the due ownership of the end products and all their constituent parts, are better suited to IT outsourcing. Such an approach is advantageous to the business. It provides the service and assigns the authority to handle the entire project from the beginning to the end.
However, staff augmentation proves more responsive for short yet very specialized projects that require constant integration with the core team. For this purpose, your in-house teams usually need the support of developers who seamlessly integrate with the rest of the team for efficient delivery.
As we have already pointed out, control is one of the distinguishing factors between staff augmentation and IT outsourcing. If it is critical to your business that you have control over all project activity in all project phases, then staff augmentation is the most suitable choice.
Augmented staff is embedded in your internal team. You can monitor them and ensure compliance with your requirements for how the project should develop.
In the case of IT Outsourcing, the service provider is expected to deliver the end service and control the completion of its different components. This results in less control over day-to-day activities. Although outsourcing vendors are responsible for delivery based on the set SLAs, they control the project.
This type of arrangement is ideal when the functions or work elements needed are not the business’s core. This way,internal resources can be freed for other, more productive activities.
In some instances, companies think that hybrid models produce optimal results. Flexible staff augmentation and information technology outsourcing make operations effective and expand capacity.
Leverage and expand individual talent for specific skills required for particular segments of a project. Outsource the periphery functions such as customer service or software building to a third-party agency.
This allows your organization to exercise control over certain activities while taking advantage of outsourcing.
With the growing need for companies to efficiently utilize and manage their IT and personnel resources, Techdots role is significant. It is able to provide both staff augmentation and IT outsourcing services that enable clients to expand and grow.
Techdots offers a unique range of staff augmentation services and boasts of providing the best possible talent. If you need a software developer, IT professional, or marketing resource, Techdots can connect you to the right people.
With our staff augmentation services, there are certain unique and beneficial features. They enable the organization to bring in skilled labor easily and comfortably within a very short time-lapse without the worries of hiring full-time employees.
Let us begin by noting that Techdots extends its outsourcing solutions beyond staff augmentation. The company provides IT support, cloud storage, and management services, entering the outsourcing IT sphere. Our IT outsourcing services provide solutions for businesses that wish to operate large-scale IT environments without the burden of investing in extra hardware or hiring specialized in-house teams.
We provide our services based on each business's needs and allow our clients to concentrate on developing their business, leaving us with the technical work. When addressing Techdots' assistance, such organizations are able to combine staff augmentation and full IT outsourcing as the need arises.
Shortly, it would not be out of place to assert that both staff augmentation and IT outsourcing will be significant aspects of the work evolution. It will help you with current working trends from anywhere, leveraging cloud services and accessing a global talent pool.
With the advent of remote employment and an increase in the need for specialized skills the practice of staff augmentation is projected to grow further.
To take Techdots, for instance, the company offers remote professionals from different countries all over the globe. It helps firms avoid geographical limits and draw their employee resources from as much of the world as they need.
IT outsourcing will most probably change with the digitization of business processes. However, businesses will still source out peripheral activities such as handling data, managing networks, and using cloud services to take advantage of experts.
Frms will seek managed service providers with capabilities to provide round-the-clock services or support to mitigate the risk of critical systems' downtime.
Maximizing the advantages of both staff augmentation and IT outsourcing involves implementing strategies. Here are some of them:
Encourage transparent and straightforward communication with your outsourced team or augmented staff. Building trust and solving problems depend on these factors.
Consistently evaluate the performance levels of your augmented personnel or external services and assess whether they meet your expectations. Periodic reviews enable you to make the appropriate corrections that yield positive project outcomes.
As business activities change, so should the staff augmentation or outsourcing strategy. Flexibility allows changes in matrix management and outsourcing strategies. So, be prepared for both.
Consider leveraging integrated tools and apps for task management and communication. It is particularly important for remote or outsourced teams to increase efficiency.
In the long run, selecting staff augmentation or IT outsourcing relies primarily on the business’s needs and aspirations.
Each model has pros and cons, but fitting them into your business processes is the key to making the best choice. Whether you need specialist knowledge or fully require IT services, both approaches are valid.
At Techdots, we assist organizations in making these choices based on the project's requirements and future expectations. We also help evaluate the appropriate staffing solution for your business.
Whether you need to add specific skills to the existing internal team or outsource certain non-core activities, we will assist you in the best possible way.
When it comes to staff augmentation, project and team management offer enhanced control. It allows for the adjustment of the number of employees up or down depending on the situation. In contrast to the IT outsourcing model, staff augmentation embeds outside expertise within the existing team.
To ensure success with staff augmentation services, it is vital to
Communication is of utmost importance in making staff augmentation successful.
The hybrid mode is primarily suitable for businesses that seek flexibility and scalability. By combining the two, companies can manage major parts of a project while leaving some non-core activities to other contracted specialists.
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